Touch Tronix, Inc $€ 880,000$ Terms of the Sale Were 2/10, Net 30

question 109

Multiple Choice

Touch Tronix, Inc. Sells component parts to Advanced Communications, Inc. a cell phone manufacturer. On December 10, 2011, Touch Tronix, Inc. sold €680,000 of goods to Advanced Communications, Inc. on account for $€ 880,000$ . Terms of the sale were 2/10, net 30. On December 18, 2011, Advanced Communications, Inc. paid the account in full. Advanced Communications, Inc. uses a perpetual inventory System. Which of the following is true regarding the impact on the statement of financial position for Advanced Communications, Inc. When the payment is made on December 18,2011 ?

• A) Assets decreased by \( € 880,000 \).
• B) Assets increased by \( € 17,600 \).
• C) Liabilities decreased by \( € 862,400 \).
• D) Liabilities decreased by \( € 680,000 \).

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Definitions:

Indifference Curves

Indifference curves are graphical representations used in microeconomics to show combinations of two goods that provide the consumer with the same level of satisfaction or utility.

Budget Constraint

The limitations on household consumption based on income and the prices of goods and services.

Utility Function

A mathematical representation of how a consumer derives satisfaction from consuming different quantities of goods and services.

Optimum Point

The most advantageous position or condition that can be achieved in a given circumstance or under certain parameters.